A Gap Insurance Policy: What Is It For?

GAP insurance covers you if you irreparably damage your motor vehicle and your car insurance coverage doesn't pay enough to settle any outstanding lending on it or the price of replacing it. GAP stands for Guaranteed Asset Protection.

There are different types of GAP insurance cover available.

They basically cover the difference in the amount your car insurance company pays out if the car is a total write-off compared with what you still owe on any loans or finance or the amount you have to pay to replace the car. GAP insurance is becoming increasingly popular due to the high depreciation costs on cars and their falling resale prices. Return to Invoice GAP insurance (RTI Gap Insurance).

You can buy RTI GAP insurance for cars aged from new to 7 years old. However it can only be bought within 3 months of buying the car.

It pays the difference between your car insurance claim settlement amount and the amount you paid for the car, the invoice amount for the car. Return to Value GAP insurance (RTC Gap).

You can buy RTV Gap insurance for cars aged between three months and seven years only.

It will pay the difference between the car insurance claim settlement and the value of your car at the time you took arranged the policy. Finance GAP insurance.

You can pay for Finance GAP insurance for cars bought on finance, using a finance transaction .

It pays the difference between your car insurance claim settlement amount and the amount of your loan . This means the payout could be more than that from RTI GAP insurance. For extra comfort you can get combined RTI and Finance GAP cover from which you get then would have the highest amount possible. Replacement GAP insurance.

You can buy replacement GAP insurance to cover the cost of replacing your car with exactly the same make/model or equivalent as you originally bought. This can only be bought for new or Ex Demo cars that are less than 3 months old and has to be purchased within 90 days of buying the car.
If this report has provoked your interest in car gap insurance then you would probably be interested in this information about new car gap insurance .

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